Comcast Says Contract Typo Threatens Its Emergency-Call Service

(Bloomberg) — A Comcast Corp. official told a judge he made a mistake in reviewing a contract a decade ago that may now result in the premature shutdown of the company’s emergency-call services, endangering hospital patients, first responders and 911 callers.

Comcast sued to block contractor CX360, which is owned by Apollo Global Management Inc., from halting the automated phone-menu service months before its contract expires. CX360 threatened the shutdown after Comcast decided to replace it with another operator. 

Thomas Stowell, a former procurement executive at a Comcast unit, testified Wednesday he missed a “nonsensical” typographical error in the contract signed in 2014 with CX360, which provided software and phone-menu services that rout emergency calls to a live agent.    

“It was my mistake,” Stowell said on the first day of the non-jury trial before Delaware Chancery Court Judge Lori Will, who will decide the case. 

The dispute centers on whether Omaha, Nebraska-based CX360 — a subsidiary of Apollo’s West Technology Group LLC — has the right to pull out of the agreement with Comcast Cable Communications Management LLC, which decided to select another contractor following a 2022 hack that disrupted CX360’s phone services. CX360 is still providing the phone service while the suit is being litigated.

In court filings, CX360 has argued that it has the right to exercise its termination right under the contract.

Comcast accuses the call-center software maker of exploiting the essential nature of its emergency-call routing services for leverage, “demanding demonstrably unfair terms and insisting on concessions” before agreeing to hand off services to the new vendor. 

Stowell, the first-witness in the case, said Comcast officials intended to give themselves the sole cancellation right “for convenience” when they negotiated the deal in 2013. The cable giant agreed to pay a termination fee worth millions of dollars if they exercised that right during the pact’s first year, he said. 

At the time the agreement was signed, the termination provision “was not a point of contention,” Stowell said. 

Comcast contends in court filings that CX360 seized on an “obvious typographical error” about providing notice of cancellation in hopes of justifying its actions. In court, Stowell said the provision requiring CX360 to notify itself about pulling out of the deal “was nonsensical.” 

But a mistake in cutting-and-pasting boilerplate contract language in the agreement resulted in CX360 also getting a termination right, Stowell acknowledged. He said he’d never made such a mistake before in other contracts he’s overseen. 

CX360’s cancellation threat amounts to an effort to “squeeze Comcast for as much revenue as possible during the transition period,” according to Comcast’s court filings. 

The case is Comcast Cable Communications Management LLC v. CX360 Inc., 2024-0991, Delaware Chancery Court (Wilmington).

–With assistance from Michael Leonard.

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